401k Loan Limits and the COVID-19 Pandemic Impact
The Coronavirus Aid, Relief, and Economic Security (CARES) Act signed into law March 27 offers some much-needed financial relief for folks battered by the pandemic’s economic fallout. In addition to cash payments, improved unemployment benefits, small business support, and other significant legislative items, the Act includes more relaxed rules for retirement savings plans like IRAs and 401(k)s. One of these items is the waiving of required minimum distribution requirements for 2020, while another increases the loan limits for those choosing to borrow from their 401k account.
Most of the items included in the CARES Act will be of substantial benefit to those presently hurting from the COVID-19 devastation of the American economy. But borrowing up to the maximum limits, while helpful in the immediate months, has a long-term downside, as The Motley Fool’s Maurie Backman explains in a post on the Winston-Salem Journal. Access her post here…